Growers are concerned the government wants to use a heavy hand that could result in many crops failing required tests and being destroyed. The U.S. Department of Agriculture, the agency writing the rules, estimates 20 percent of hemp lots would fail under the draft regulations.

“Their business is to support farmers — and not punish farmers — and the rules as they’re written right now punish farmers,” said Dove Oldham, who last year grew an acre (0.40 hectares) of hemp on her family farm in Grants Pass, Oregon. “There’s just a lot of confusion, and people are just looking for leadership.”

]]>Rocky Road For Hemp 2020https://reupworldwide.com/rocky-road-for-hemp-2020/
Thu, 02 Jan 2020 19:17:43 +0000https://reupworldwide.com/?p=209280Optimism around a three-day hemp auction in Tennessee turned to disappointment when producers found way more sellers than buyers, driving prices down and leaving some frustrated.

But organizers of the inaugural International Hemp Auction and Market, modelled after tobacco auctions in the area, say the market volatility will settle down, making future auctions more valuable.

The oversupply in November was too much for farmers such as Ryan Rowlett, a hemp grower from Greeneville, Tennessee, who returned home from the auction in Franklin with the 2,500 pounds of CBD biomass he’d taken to sell.

“There were too few buyers and too much biomass,” Rowlett said. “I was hoping there would be enough buyers to compete and drive up the price.”

Lopsided market

The auction drew hundreds of farmers from around the country with thousands of pounds of biomass, hemp flower and CBD oil, and roughly 70 registered buyers attended.

The uneven ratio of buyers and sellers didn’t faze auction founder and CEO Mark Case, who pointed out that most auctions don’t have equal numbers of buyers and sellers.

“If you have 1,000 buyers on the Chicago Board of Trade, but the commodity is not selling for more than $2.67 a pound, you’re not going to have more money,” said Case, who is also a hemp farmer and processor.

“Once you meet a point in the market, the number of buyers doesn’t make a difference.”

Case, who declined to share final sales figures, acknowledged the auction timing could have been better for farmers, considering dropping prices for biomass and hemp flower.

“The objective was that transparent playing field, and that did happen – it’s just unfortunate it was when the market price was poor, because of the appearance of oversupply,” he said.

Bidding wars

Problems started on the first day of the sale, when 160,000 pounds of biomass, representative samples of what farmers still had to sell back at home, were tested and readied for bidding.

Casey Flippo, CEO and co-founder of Little Rock, Arkansas-based extractor firm Natvana, told Hemp Industry Daily he knew there was trouble when he arrived in Franklin and 75% of the biomass had been through the auction but nothing had been sold. The bids were coming in too low.

“They literally stopped, sent the buyers to the back and asked to let them adjust a little bit, and that’s how we proceeded from there,” Flippo said.

Case paused the auction to talk with both buyers and sellers about why the crops weren’t selling.

In contracts for auction participants, floor prices had been set at:

$1 per percentage point under 10% CBD.

$1.25 per percentage point over 10% CBD for biomass.

$100 per pound of CBD flower.

“Now, that’s a low price. But a month earlier, people were paying less than $1 (per point for biomass) in Oregon, so I was thinking surely we’d get at least that and hopefully $1.50-$2.50 a pound,” Case said.

According to the November hemp report from PanXchange, an online trading platform based in Denver, biomass sold for $0.80 to $1.40 per CBD percentage point, down from $1.61 to $2.71 per point in October.

Meanwhile, Colorado winterized crude oil prices were $750 to $1,300 per kilogram, down 16% from October prices of $850 to $1,600 per kilogram, comparatively.

The end prices went below the floor. Case said that many farmers told him they just wanted to unload their hemp and chose to sell under the baseline prices.

“The general consensus was that there were people that wanted to get out of the market and they wanted to sell under the support price,” Case said.

According to Case, the final prices were:

50 cents to $1.10 per percentage point for biomass.

Up to $75 per pound for smokable CBD flower.

Up to $200 per pound for CBG flower.

$600 per kilo for CBD crude oil.

Price points under pressure

Hemp flower was sold on the second day of the auction and went better, according to Flippo. Case reopened bidding for biomass on the last day to give farmers another opportunity to sell their crops.

“It’s very hard to come up with new ideas and bring it to fruition and not have hiccups,” Flippo said.

Although Rowlett didn’t sell his biomass or flower at the auction, he said he made some valuable contacts.

“I didn’t think the auction would be the end-all, be-all solution, but it helped facilitate a lot of things,” Rowlett said.

Prices could have been better, Flippo said, but he told Hemp Industry Daily he suspects many of the buyers were there to see how good of a deal they could get.

Other baseline issues prevented transactions from happening.

With the current patchwork regulation in states across the U.S., some buyers who planned to take their hemp back to hemp states that measure total THC couldn’t bid on some lots, Case said.

Because Tennessee currently measures only delta-9 THC instead of total THC, the levels were fine for in-state buyers and other adjacent states testing for delta-9 only.

“There was some really good quality – we had some real clean, green, 21% (CBD) and we had some real poor quality 8% (CBD). And some people just didn’t have good quality in general,” Case said.

“I don’t like to be quite so frank with farmers because I’m a farmer, so I understand their pain,” he said. “But I’m a processor as well, so I understand the difficulties (with poor quality crops), and we were very honest and forthright” about quality.

More opportunities to sell

The first attempt at an auction in the hemp industry had some speed bumps, Case admits.

He said his staff is working to correct the issues with logistics, procedures, pricing and fees by forming an advisory board of hemp industry members and relaunch a series of regional auctions starting in the spring.

No dates or locations are set yet, but the invitations have been rolling in from North Carolina, Oregon and Texas, Case said.

]]>Diverse audience weighs in on USDA’s Hemp Regulations!https://reupworldwide.com/diverse-audience-weighs-in-on-usdas-hemp-regulations/
Tue, 31 Dec 2019 02:53:40 +0000https://reupworldwide.com/?p=209206Part 2 of a two-part series looks at what ancillary businesses, industry associations and public figures have to say about the USDA’s interim final rule for federal hemp production. Part 1 examined comments submitted by hemp farmers.)

In its open call for comments on federal hemp production regulations, the U.S. Department of Agriculture (USDA) has received more than 1,300 responses.

Comments submitted by Jan. 29, 2020, will be considered before a final rule is created, according to the agency.

Respondents so far have ranged widely from farmers and processors to industry associations, members of Congress and even law enforcement.

Hemp Industry Daily reviewed the public comments to find out what ancillary businesses, industry associations and public figures were saying:

Emily Gogol, a Hemp processor, Oregon

As a small business owner with a PHD. in biomedical science, I feel strongly that many of the proposed regulations for the domestic hemp program should be amended.

Specifically, I would ask:

Hemp for extraction has different regulations than hemp for a smokable product. During the hemp extraction process, THC can be removed. There are a variety of technologies already in use that are effective, and we are conducting additional research to develop more efficient and less costly methods.

Be concerned only with psychoactive compounds, like delta-9 THC. There isn’t strong evidence for what is a medically relevant percentage of THC. From a biomedical perspective, the 0.3% total THC doesn’t have strong evidence to back it up.

Jonathan Miller, general counsel and member of U.S. Hemp Roundtable, Kentucky

The interim final rule requires all noncompliant plant material to be destroyed. However, Congress directed no such destruction in the Farm Bill and, in fact, specifically directs disposal as follows: ‘‘(iii) a procedure for the effective disposal of -‘‘(I) plants, whether growing or not, that are produced in violation of this subtitle.”

We recommend that noncompliant parts of the plant be permitted for use on the farm, with feedstock or fuel, with a prohibition of it on entering commerce with exceptions.

Particularly in light of the tremendous value of hemp biochar as a soil amendment and for research and development purposes, we specifically suggest spelling out that pyrolysis is an acceptable means of effective disposal, and the resulting char may enter into commerce.

U.S. Sens. Ron Wyden and Jeff Merkley, Oregon

The 2018 Farm Bill requires testing for delta-9 tetrahydrocannabinol (THC) using “postdecarboxylation or other similarly reliable methods.” Reliable testing methods have emerged that do not necessitate decarboxylation to accurately measure THC concentrations.

Instead of allowing similarly reliable non-decarboxylation tests to be used to measure delta-9 THC, the interim final rule introduced a new requirement, contrary to the specific language in the 2018 Farm Bill, that hemp samples must be tested using methods where the “THC concentration level reported accounts for the conversion of delta-9-tetrahydrocannabinolic acid (THC-A) into THC.”

As authors of the Hemp Farming Act of 2018 that was included in the 2018 Farm Bill, we believe strongly that this is a complete reversal of the congressional intent expressed in that law and requires testing that Congress specifically did not include.

Given the 2018 Farm Bill specificity, and because it allows for flexibility in testing methods by allowing “other similarly reliable methods,” we encourage USDA to allow testing for delta-9 THC using methods that do not involve the application of heat or decarboxylation, and to remove all requirements for converting THCA into THC.

U.S. House of Representatives, Virginia delegation

The interim final rule establishes a negligence threshold of 0.5%. If the THC level is found to be above 0.5%, a farmer could be prosecuted under the law.

The 0.5% threshold is arbitrary and too low given that THC levels are subject to swings based on several factors, including location, weather and timing.

We would like to make two suggestions for consideration:

First, we recommend this threshold be set at the highest possible threshold in order to protect good-faith farmers who follow the rules, plant certified seeds and clones and engage in best practices to grow compliant hemp.

Second, we recommend adding mediation options so that farmers acting in good faith who accidentally exceed the threshold can resolve the issue without fear of criminal prosecution.

Ray Mazzie, Hemp Industries Association, Florida chapter

By combining THC-A and THC, farmers are going to be forced to harvest much earlier and lose substantial cannabinoid content, thus reducing the farmers’ revenue significantly.

This can have a serious chilling effect on the amount of acres planted and thus increase prices for the consumer significantly.

Further, the reduction of domestic supply will incentivize hemp biomass, or hemp derivatives, purchasers to import their supply.

The foreign supply will not only have labor cost advantages, but it will be subject to a less restrictive regulatory regime, essentially pricing domestic hemp and hemp derivatives out of the market.

Frank Vasquez, Santa Barbara Sheriff’s Office, California

Currently, I am charged with supervising the cannabis enforcement program for a largely cannabis-populated county in California.

During my time, I have assisted in developing regulation, enforcing state and local laws and promoting a fair regulatory process through accountability and deterrence. Deterrence is the biggest factor of pushing operators to do the right thing.

During this journey, I have seen hemp, and it’s very difficult to distinguish from cannabis. In fact, we have and are working in several cases where hemp is being grown, as a cover crop for cannabis, and these investigations are difficult at best.

There are several reasons for that, but the biggest being hemp is legal, and warrants to enter and test are difficult absent specific circumstances or information. My agency even has purchased a THC testing machine to aid in this, but again, we need to get access to the hemp in order to test and resolve the concern, or push forward a criminal investigation.

There is a public expectation we look at everything, and I feel accountability and deterrence will help us, as a community, deal with any and all negative impacts of cannabis and hemp.

Access is the key to the balance, which is the most difficult task.

North Carolina Industrial Hemp Council

Requiring the sampling of all hemp produced is simply not feasible without significant additional resources to cover the cost of additional staff.

North Carolina currently has over 1,350 licensed hemp growers. This past fall, the North Carolina Department of Agriculture and Consumer Services tested 55% of the thousands of hemp fields planted across our state, with employees working up to 70 hours a week. It is impossible to ask this staff to do more and we are not aware of any state that has been able to physically sample each field.

Additionally, the sheer magnitude of sampling volume during peak harvest periods would push the analytical limits of any laboratory testing THC levels.

We respectfully request that USDA consider allowing states to perform random and risk-based sampling of hemp grown in their state. … It seems unnecessary to have the testing labs be registered with the (Drug Enforcement Administration) DEA since this was not required of pilot programs and may cause additional delays in sampling as laboratories seek certification.

The proposed 15-day pre-harvest testing window creates a very narrow time frame for growers, creating another unnecessary obstacle for compliance.

It is not unrealistic to think that growers may encounter weather or other constraints that may force them to harvest hemp without knowing whether it is compliant due to inevitable delays in laboratory results because of high sample volumes.

Based on our experiences, we do not think states will have the resources to … deliver samples to an approved laboratory and receive results all within a 15-day window.

]]>20 PREDICTIONS FOR 2020https://reupworldwide.com/20-predictions-for-2020/
Tue, 31 Dec 2019 02:34:37 +0000https://reupworldwide.com/?p=209201As the hemp industry nears the end of a year of tremendous change, it can be easy to marvel at the progress the industry has made in the past 12 months. But we wanted to find out what’s next for the hemp industry. So Hemp Industry Daily caught up with 20 insiders from across the hemp supply chain to find out not where the industry has been but where it’s going. Here’s what we learned: Mark Case, founder and CEO, International Hemp Auction and Market, Knoxville, Tennessee 2018 was a gamble but a good year for most. 2019 was a gamble but a thin year for most. 2020 is not a year for gamblers. Rather, it will be successful only for those who are wise and prudent, fully integrated and who work with a good business plan to go the long haul. Brenda Verghese, vice president of research & development, Stratos, Colorado Springs, Colorado I predict that while the regulations remain “nonexistent,” the industry will become even more saturated with smaller players. However, if and when the (U.S. Food and Drug Administration, USDA) does come in with regulations, many of these existing companies will not be able to withstand the cost of investment to keep up with regulations. In turn, the cost of product and hemp will go back up, and the arena will have a lot fewer players. Ted Haney, executive director, Canadian Hemp Trade Alliance, Calgary, Alberta I predict increased hemp acres in Canada, likely moving toward 200,000 acres. I also predict an increased focus on whole-plant utilization. The United Nations International Commission on Narcotic Drugs will remove low-THC hemp extractions from the UN 1961 Single Convention on Narcotic Drugs. Finally, I predict an increase in the sale of hemp protein concentrate and hemp protein isolate to large food processors. Kim Collier, hemp consultant and wellness coach, Missoula, Montana Buckle up. We are unstoppable. Specifically for business development, collaborations are key. I think we’re going to go beyond concerns about, “My product has to be the best.” I think it’s going to be the collaboration of science, location, products and ingredients for a very effective healing experience and strong business plan in this space. James McCoy, hemp farmer and retailer, Pahrump, Nevada We’ve already grown this year like eight times more hemp than we needed. The consumer hemp market is not nearly as robust as people predicted it to be. So I see a whole lot of really cheap hemp, getting cheaper. Ray Mazzie, executive director, Hemp Industries Association of Florida, Tallahassee The hemp industry will surely experience explosive growth in 2020 as the USDA and FDA (U.S. Food and Drug Administration) begin to release rules, take comments and eventually implement said regulations. Compliance and learning from others’ mistakes will prove to be invaluable to 2020 hemp operators, regardless of where they sit in the supply chain. Marysia Morawska, horticulture educator, University of Nevada, Las Vegas I think a lot of these farmers are going to realize that the cannabis plant is not a CBD plant. What we’re going to see is a movement toward a trifecta or even quad-usage plant – so, something that’s utilized for the hurd, for the fibre, for the flower, for the grain. And once we realize what those genetics are, we’ll end up realizing that each region specifically has growing styles that will be differentiated by the genetics of that region. And we will move into a place where processing will include not just CBD. I think CBD will become the byproduct of the cannabis plant. Patrick McCarthy, CEO, ValidCare, Denver The U.S. consumer is going to wake up to the fact that certification and dosing matters. They’re going to get particular, where they’ve been trying things in the past. They’re going to start really paying attention to, what is the product I’m taking? How do I know that it’s safe? How do I know how much that I should take, and who says it’s safe? Ross Burtness, founder, ReGrow, San Diego With the mass adoption of CBD products already in place, we will start to see a more compartmentalized line of products aimed at new and existing consumers. Stricter regulations will push the market toward adopting proper genetics, DNA markers and compliant resin varieties. With the emergence of data-driven insights, cutting-edge management technology and predictive tools, there will be more variety available to the public at lower costs. Jillian Hishaw, founding director, Family Agriculture Resource Management Services (F.A.R.M.S), Charlotte, North Carolina 2020 will bring more stabilization to hemp farmers as they enter the planting season. Due to the extensive loss suffered by many small farmers who grew hemp this year, many will grow fewer acres and seek out securing purchase contracts with established processors and companies in California, Colorado and international markets, if possible. Many farmers that suffered an unrecoverable loss will not plant next year but wait until 2021 to ensure the regulatory kinks have been ironed out in 2020. Farmers of colour will have more opportunities growing cannabis due to the 10-year felony restriction on hemp excluding many farmers of colour out of the industry who factually have higher prior conviction rates. Casey Flippo, CEO, Natvana, Little Rock, Arkansas In 2020, the U.S. hemp industry is going to transcend previous norms by exponential amounts. Farmers and processors are going to have to come up with creative solutions to adhere to the domestic surplus as well as the pressure from consumers to provide a more economically reasonable end-product. Scott Propheter, vice president agronomy and outreach, Criticality, Hobgood, North Carolina I think there will be an overall decline in planted acreage for 2020 caused by the oversupply from 2019. I also believe that 2020 will be the catalyst year that begins a widespread consolidation in the processing community as margins continue to compress. Priyanka Sharma, co-CEO, Kazmira, Watkins, Colorado We will see investment into genetics and harvesting technology in order to adhere to the USDA final rule. I expect an increase in research on cannabinoids and various hemp strains by universities. We will see newly formulated products enter the market at compact sizes with higher cannabinoid content. I foresee more consumer awareness on the traceability of the product from farm to shelf. Charlie McKenzie, chief adviser, Bioculture Group, Columbus, Ohio While we find ourselves surrounded by quite a bit of uncertainty going into next hemp season, I am certain that an increased focus on business integrity and ethics, operational efficiencies, regulatory compliance and product quality will be necessary for any hemp farm or business to see success in 2020 and beyond. Wesley Ray, co-founder, Combined Hemp, Bend, Oregon 2020 will resemble 2019 with twice the amount of land. The only difference besides acreage is the letters abbreviating the cannabinoid. CBG breeders exploded onto the map when total THC testing was in the USDA proposed rules. Expect the same with feminized CBG seeds popping up at an alarming rate. New explorers to the industry, be alert, do your research and learn from the farmers of 2019’s mistakes. Michael Bronstein, president, American Trade Association for Cannabis and Hemp, Washington DC The hemp industry will have the best year of growth since (President Franklin Delano Roosevelt signed an executive order in 1941 legalizing hemp production for the U.S. effort in World War II), but not everyone is going to win. The complexity of the business and supply issues in the market will favour early adopters who can produce quality and consistent product at scale. Additionally, the CBD market will find increasing competition and additional regulatory scrutiny before the dust settles. Brent Williams, managing member, Highwater Financial, Nashville, Tennessee We believe that the hemp industry will have a large focus on expanding infrastructure in 2020. Farmers will see a painful loss of both money and crops from the 2019 season due to limited access to drying, proper storage or timely processing. With many farmers getting burned on production contracts in 2019, we also believe there will be a slower growth rate in the number of acres grown until there is a tangible increase in demand. Adrienne Snow, founder, Western States Hemp, Reno, Nevada I think extraction capacity will increase by up to another 20%. Grow licenses will possibly double, however, the actual harvested product will most likely increase only by 50%. There will still be a lot of confusion between the states and the USDA. The big players will continue to watch from the sidelines through 2020, awaiting calmer seas before jumping in and truly merging Wall Street and hemp. Claire Crunk, president, Southeast Hemp Fiber, Santa Fe, Tennessee We will see emerge a tighter, higher standard for manufacturing practices in extraction as regulatory frameworks and consumer awareness improve. We will also observe continued innovation in fibre processing methodology and fibre product development that will feature domestically grown hemp fabrics and bioplastics applications. Russ Cersosimo, co-founder, Hemp Synergistics, Pittsburgh With increased regulatory compliance on the horizon, I expect to see many of the first-wave farmers, extractors and product manufacturers exit the business. Those who jumped into the industry without any real experience in farming, extraction, science or CPG (consumer packaged goods) will be challenged to compete successfully in a regulatory industry and changing landscape. The second wave is coming in 2020, and the market will level out – but only the most qualified and advanced will be positioned to succeed to serve the market with high-quality products on a consistent basis.
]]>Are CBD Customers Really Getting What They Pay For?https://reupworldwide.com/are-cbd-customers-really-getting-what-they-pay-for/
https://reupworldwide.com/are-cbd-customers-really-getting-what-they-pay-for/#commentsTue, 26 Nov 2019 16:13:48 +0000https://reupworldwide.com/?p=208227CBD seems to be everywhere. It can be found in all kinds of everyday products, from lotions to supplements, as well as dog food. CBD, or cannabidiol, is found in cannabis plants. It doesn’t give the user a high, but it’s being marketed to relieve all kinds of ailments.

The CBD products sold often indicate on the label how much of the chemical is contained inside. The products can list anywhere from a few milligrams to a few hundred. Inside Edition wondered if customers are actually getting the amount of the chemical they’re paying for.

To find out, we bought some products and sent them off to a lab for testing. We purchased CBD from all types of retailers, including upscale stores and products sold online. The results were surprising, as lab tests found three of the nine products we purchased contained less CBD than was advertised.

CBD gummies purchased at Barneys claimed to contain 10 mg. However, the lab found just 6-7 mg in the edible. When we told the distributor, Lab to Beauty, the company insisted the amount was correct and supplied an independent lab test to back it up. The company also says although they’ve had no customer complaints, they will do additional testing to further ensure their product’s accuracy. Barneys had no comment.

]]>https://reupworldwide.com/are-cbd-customers-really-getting-what-they-pay-for/feed/1Farmers should be helped to grow hemp, not blockedhttps://reupworldwide.com/farmers-should-be-helped-to-grow-hemp-not-blocked/
https://reupworldwide.com/farmers-should-be-helped-to-grow-hemp-not-blocked/#respondTue, 26 Nov 2019 15:51:29 +0000https://reupworldwide.com/?p=208222Britain’s cannabis revolution is growing apace. Last year medicinal marijuana was legalised and this year six million Britons took cannabidiol (CBD) supplements, making them more popular than Vitamin C and D tablets combined.

Demand for this legal cannabis compound has grown to such an extent that you can now buy CBD-infused leggings and even CBD hummus. Yet the Home Office’s counterproductive and anti-science stance on hemp, the plant from which it is extracted, is putting British farmers at the back of the queue to benefit from this unprecedented trend and forcing them to destroy tonnes of useful crop every year.

Hemp is one of the world’s oldest crops, having been first spun into usable fibre more than 10,000 years ago. But recently it has been…

]]>https://reupworldwide.com/farmers-should-be-helped-to-grow-hemp-not-blocked/feed/0Recognition of CBD as Novel Food could have industry ramificationshttps://reupworldwide.com/recognition-of-cbd-as-novel-food-could-have-industry-ramifications/
https://reupworldwide.com/recognition-of-cbd-as-novel-food-could-have-industry-ramifications/#respondTue, 26 Nov 2019 15:14:35 +0000https://reupworldwide.com/?p=208209The future of the European CBD market may be disrupted by a German court’s decision to classify CBD as either a prescription medicine or Novel Food.

The decision to recognise CBD as a Novel Food follows on from the direction of the European Commission (EC). The EC provided its view in January that CBD products, and products containing it, should be considered a Novel Food and shouldn’t be sold without further evaluation and authorisation.

The Cannabis Law team at London-based international law firm Mackrell. has said that this could have wide ramifications for the CBD industry.

CBD as a Novel Food

A Novel Food is defined as food that had not been consumed to a significant degree by humans in the EU before 15 May 1997, when the regulations were introduced.

The principles underpinning Novel Food rules in the European Union are, among other things, that any prospective foods must be safe for consumers and properly labelled, so as not to mislead consumers.

Where a Novel Food is intended to replace another food, it must ‘not differ in a way that the consumption of the Novel Food would be nutritionally disadvantageous for the consumer’.